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People travel on a train in central Pyongyang in April.   © Reuters
Economy

North Korea feeling tighter squeeze from sanctions

Pyongyang rushes to tackle foreign currency shortage

SEOUL -- More signs have emerged that North Korea is feeling the effects of sanctions imposed by the international community -- gasoline prices have soared, and the country is moving to fight its foreign currency shortage stemming from trade restrictions.

North Korea's cellphone imports have jumped, a source at the Korea Trade and Investment Promotion Agency said Tuesday. Pyongyang apparently uses cellphone sales to obtain foreign currency held by wealthy citizens. It is able to pocket foreign currency via importing cellphones from China for $100 each and reselling them for $300 on the country's black markets, which are called jangmadang.

Cellphone imports spiked more than 80% on the year to $58 million in the January-June period, data from the Korea International Trade Association shows.

Further, Pyongyang is limiting the participation of foreigners at major events, according to a report released Tuesday by the South Korean Ministry of Unification. The country also canceled a beer festival in Pyongyang scheduled for July as well as an air show that was planned for September in the eastern city of Wonsan.

Prices of rice and exchange rates in North Korea have been relatively stable, despite freshly imposed sanctions on Sept. 11 by the U.N. Security Council. Gasoline prices, meanwhile, apparently tripled from the start of the year.

The Ministry of Unification expects that over time, the sanctions will begin to impact trade, prices and people's daily lives.

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